Geoff Russ: Mark Carney can’t be trusted to get immigration under control

2025/03/31 Leave a comment

Example of any number of articles and commentary by Postmedia columnists warning that the appointment of Mark Wiseman, and to a lessor extent, Marco Mendocino, mean that PM Carney will continue the same high immigration policies of Trudeau. IMO, too early to tell, whether he would continue or expand the restrictions of former Minister Miller, or not. But certainly Wiseman’s appointment could be interpreted as such:

Donald Trump and his tariffs will not be the only key issue that determines who will be prime minister after April, 28. Canada has been plagued by a diverse set of problems for years, all of which will be remembered by voters on election day, including immigration.

Prior to Trump’s election and his decision to threaten Canada, one of the biggest controversies in Canada was the abrupt end of an uncontested pillar in Canadian political culture — immigration. It crumbled as if struck by a sledgehammer after just a few years of the Trudeau government’s careless mass-immigration policies.

The numbers laid bare illustrate Canada’s resulting issues of scarcity. Simply put, Canada is not built to sustain half a million newcomers per year.

Stephen Harper’s government admitted roughly 250,000 permanent residents per year between 2006 and 2015. The Trudeau wave saw those numbers increasing from Harper’s pre-2015 levels, to an average around 334,000, with four years (2019, 2021, 2022, and 2023) exceeding 341,000, at a time when Century Initiative, lobby group that advocates for dramatically higher immigration levels, was at the height of its influence in Ottawa.

In 2018, representatives of the Initiative lamented that Canada’s annual intake of about 310,000 people per year would only increase the population to 53 million by 2100, and called for an increase to 450,000 to reach the goal of 100 million.

Created by former McKinsey executive, Dominic Barton and former BlackRock executive Mark Wiseman, Century Initiative publicly endorsed the Trudeau government’s moves to take in 500,000 new immigrants per year by 2025.

However, the scheme rapidly lost all political currency as the population influx rocked Canada. Immigration-driven demand for housing and services vastly outstripped the supply of both, resulting in a palpable decline in affordability and access to health care, schooling and social services.

Between 2015 and 2024, Canada’s ranking in the Human Development Index plummeted from 9th to 18th, while the country fell behind Italy in the average growth of real GDP per capita.

Western governments since the Great Recession have tried to claim that large-scale immigration is an unambiguous economic benefit. Given the state of the economies of Canada, Germany, and others that embraced mass immigration, immigration has not been a silver bullet to remedy slow growth and stagnation.

Immigrants themselves are not at the root of Canada’s long-standing problems. However, it is also clear that increasing their numbers in such a deliberate fashion failed to make Canada more competitive or improve the lives of its citizens.

There has not been a meaningful increase in the numbers of engineers, physicians, and software developers. In essential services like health care, the ratio of family doctors in relation to the general population has actually worsened. Rather, Canada has imported hundreds of thousands of unskilled international students who stock shelves, deliver food, and flip hamburgers for minimum-wage.

On the other hand, academic institutions have become dependent on this new class of economic immigrant, who often enters the country on a student visa to attend suspect career colleges while paying exorbitant international student fees.

This is not an economic climate that breeds dynamism or healthy growth. Canada needs to be a top choice for highly-skilled immigrants, which means having attractively affordable housing and quality services, neither of which have been rapidly deteriorating.

Even if the restrictions on foreign credentials are loosened in Canada, few trained doctors or dentists from India or South Africa will pick Toronto over Dallas as long as the latter offers substantially higher paycheques and cheaper housing.

In-fact, just 46 per cent of immigrants are now choosing to receive Canadian citizenship, compared to 72 per cent in 1996. Last fall, Ipsos found that just over one quarter of all newcomers plan on leaving Canada within two years, with many citing the lack of affordability. This they have in-common with younger Canadians, many of whom are resigned to bleak and leaner lives than those enjoyed by their parents.

It is therefore concerning that Mark Carney has brought on Century Initiative co-founder Mark Wiseman as an advisor, whose name is ironic considering the results of his lobby group’s ideology. Canadians do not want Century Initiative-inspired ideas anymore, with nearly 60 per cent of residents polled last summer wanting substantially less immigration.

Unlike Europe, where mass-immigration has resulted in a slew of cultural and social clashes between asylum seekers and the established population, the pushback to immigration in Canada still mostly stems from economic factors, particularly housing.

Nonetheless, Wiseman’s presence on the prime minister’s team is political poison. He once even publicly endorsed pushing the Century Initiative’s agenda, even if it caused outrage in Quebec.

For many Québécois, their future is a major source of concern as their demographic place in North America shrinks. The prospect of more mass immigration could be the landmine that blows up Carney’s current run of goodwill in Quebec.

Without Quebec, Carney has little hope of winning a majority government, and even a parliamentary plurality is uncertain. Within hours of Wiseman’s involvement being announced, both the Conservatives and the Bloc Québécois went on the attack, in both official languages.

Pierre Poilievre himself attacked the Century Initiative as striving to “bring in people from poor countries in large numbers, to take away Canadian jobs, drive wages down and profits up,” and that Canada should only admit people who can be actually housed and employed

Wiseman’s role will harden the perception that Carney is merely feigning a Liberal shift back to the centre under his leadership. It was a misstep that undercuts Carney’s credibility on immigration caps, which he has nominally pledged to maintain until housing is expanded.

To their credit, the Liberal government significantly scaled back the annual immigration numbers in Trudeau’s final months as PM, if only due to public backlash. A new leader, and Trump’s blustering, has gifted the Liberals a huge opportunity to reinvent themselves as the defenders of the country, while sidestepping hard questions about their thus far poor record in government.

Mark Carney is saying and promising all the right things to pull the Liberals back towards the centre and a genuine pro-growth agenda, earning him plaudits across the political spectrum, even from conservatives. However, if he continues to surround himself with the same crew of advisors and cabinet ministers who sailed Canada into a lost decade, can Carney truly be the captain to right the ship, least of all on immigration?

Source: Geoff Russ: Mark Carney can’t be trusted to get immigration under control

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Todd: This should be the first Canadian election that focuses on migration

2025/03/28 Leave a comment

I suspect, however, that it will not given that immigration, like so many other issues, is drowned out by the existential crisis of the Trump administration. But yes, appointments by PM Carney provide a hook to raise the issue and cite the excessive influence of the Century Initiative in past government policy before former immigration minister reversed course. As I have argued before, his changes provide space for immigration policy discussions without being labelled as xenophobic or racist.

Skuterud’s comments on rotating immigration ministers is valid and unfortunately former minister Miller was shuffled out by PM Carney:

A controversial appointment put migration in the headlines on the same weekend that Prime Minister Mark Carney announced a snap election.

The investment fund manager and former head of the Bank of Canada, who won the Liberal leadership contest two weeks ago, became the subject of news stories focusing on how he has chosen Mark Wiseman, an advocate for open borders, as a key adviser.

Wiseman is co-founder of the Century Initiative, a lobby group that aggressively advocates for Canada’s population to catapult to 100 million by 2100. Wiseman maintains Canada’s traditional method of “screening” people before allowing them into the country is “frankly, just a waste of time.” The immigration department’s checks, he says, are “just a bureaucracy.”

Wiseman believes migration policy should be left in the hands of business.

The appointment of Wiseman is an indication that Carney, a long-time champion of free trade in capital and labour, is gathering people around him who value exceptional migration levels and more foreign investment, including in housing.

Carney denied a charge by Conservative leader Pierre Poilievre that bringing in Wiseman “shows that Mark Carney supports the Liberal Century Initiative to nearly triple our population to 100 million people. … That is the radical Liberal agenda on immigration.”

Carney tried this week to distance himself from the Century Initiative, telling reporters Wiseman will not be advising him on migration.

For years, migration issues have been taboo in Canada, says SFU political scientist Sanjay Jeram.

But the Canadian “‘immigration consensus’ that more is always better” is weakening, Jeram says. Most people believe “public opinion toward immigration has soured due to concerns that rapid population growth contributed to the housing and inflation crises.” But Jeram also thinks Canadian attitudes reflect expanding global skepticism.

Whatever the motivations, Poilievre says he would reduce immigration by roughly half, to 250,000 new citizens each year, the level before the Liberals were elected in 2015. The Conservative leader maintains the record volume of newcomers during Trudeau’s 10 years in power has fuelled the country’s housing and rental crisis.

Carney has said he would scale back the volume of immigration and temporary residents to pre-pandemic levels, which would leave them still much higher than when the Conservatives were in office.

What are the actual trends? After the Liberal came to power, immigration levels doubled and guest workers and foreign students increased by five times. Almost three million non-permanent residents now make up 7.3 per cent of the population, up from 1.4 per cent in 2015.

Meanwhile, a Leger poll this month confirmed resistance is rising. Now 58 per cent of Canadians believe migration levels are “too high.” And even half of those who have been in the country for less than a decade feel the same way.

Vancouver real-estate analyst Steve Saretsky says Carney’s embracing of a key player in the Century Initiative is a startling signal, given that migration numbers have been instrumental in pricing young people out of housing.

Saretsky worries the tariff wars started by U.S. President Donald Trump are an emotional “distraction,” making Canadian voters temporarily forget the centrality of housing. He says he is concerned Canadians may get “fooled again” by Liberal promises to slow migration, however moderately.

Bank of Canada economists James Cabral and Walter Steingress recently showed that a one per cent increase in population raises median housing prices by an average of 2.2 per cent — and in some cases by as much as six to eight per cent.

In addition to Carney’s appointment of Wiseman, what are the other signs he leans to lofty migration levels?

One is Carney’s choice of chief of staff: former immigration minister Marco Mendicino, who often boasted of how he was “making it easier” for newcomers to come to the country. Many labour economists said Mendicino’s policies, which brought in more low-skilled workers, did not make sense.

By 2023, the Liberals had a new immigration minister in Marc Miller, who began talking about reducing migration. But Carney dumped Miller out of his cabinet entirely, replacing him with backbench Montreal MP Rachel Bendayan. Prominent Waterloo University labour economist Mikal Skuterud finds it discouraging that Bendayan will be the sixth Liberal immigration minister in a decade.

New ministers, Skuterud said, are vulnerable to special interests, particularly from business.

“It’s a complicated portfolio,” Skuterud said this week. “You get captured by the private interests when you don’t really understand the system or the objectives. You’re just trying to play whack-a-mole, just trying to meet everybody’s needs.”

Skuterud is among the many economists who regret how record high levels of temporary workers have contributed to Canada being saddled with the weakest growth in GDP per capita among advanced economies.

Last week, high-profile Vancouver condo marketer Bob Rennie told an audience that he pitched Carney on a proposal to stimulate rental housing by offering a preferred rate from the Canada Mortgage Housing Corp to offshore investors.

We also learned this week that Carney invited former Vancouver Mayor Gregor Robertson to run as a Liberal candidate. Robertson was mayor during the time that offshore capital, mostly from China, flooded into Vancouver’s housing market. When SFU researcher Andy Yan brought evidence of it to the public’s attention, Robertson said his study had “racist tones.” Two years later, however, Robertson admitted foreign capital had hit “like a ton of bricks.”

It’s notable that Carney, as head of the Bank of England until 2020, was one of the highest-profile campaigners against Brexit, the movement to leave the European Union.

Regardless of its long-lasting implications, Brexit was significantly fuelled by Britons who wanted to protect housing prices by better controlling migration levels, which were being elevated by the EU’s Schengen system, which allows the free movement of people within 29 participating countries.

For perhaps the first time, migration will be a bubbling issue this Canadian election.

While the link to housing prices gets much of the notice, SFU’s Jeram also believes “the negative framing of immigration in the U.S. and Europe likely activated latent concerns among Canadians. It made parties aware that immigration politics may no longer be received by the public as taboo.”

Source: This should be the first Canadian election that focuses on migration

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Wiseman: Canada’s productivity weakness has a greater impact than most believe 

2023/03/28 Leave a comment

Welcome greater focus on productivity and per capita GDP from by the chair of the Board of Directors of the Century Initiative, rather than just population and overall GDP growth (the Coalition for a Better Future has a tighter focus on productivity than CI but is largely composed of similar members):

When Finance Minister Chrystia Freeland tabled her budget last year, Canada’s growth prospects were identified as a significant vulnerability and priority for the government. She sensibly recognized human capital and the green transition as the first two of three “pillars” required to tackle the problem, then identified the third as the “Achilles heel of the Canadian economy” – poor productivity.

Having recently torn my Achilles tendon, I can tell you the sharp, sudden pain experienced is quite unlike the slow, creeping problem that productivity growth has become in Canada. This is not an issue that suddenly emerged, rather it has sunk intrinsically into the fabric of our commercial activity and eroded Canada’s appetite for innovation.

Compared to peer countries, our productivity has been receding for decades, and its importance has been largely ignored by Canadian business and political leaders. An Achilles injury, while extremely unpleasant, means you hobble around for a few months until you get back on your feet – but that isn’t the case here. Our productivity stagnation continues to spread to all areas of the economy, like a malignant tumour.

While some economic indicators are rosy for Canada – unemployment is low, wages are rising – productivity rates are not. Labour productivity growth has slowed to less than 1 per cent today from 2.7 per cent in the 1960s and 1970s. The OECD has us ranked dead last of all the advanced economic countries in the world in its predictions for real GDP per capita growth from both 2020-30 and 2030-60.

While it’s widely known that Canada lags the United States, we have also fallen behind France, Germany, Britain, Australia and Italy in productivity. The Canadian work force is less productive because, on average, companies here use less capital and technology, are less innovative, and operate at a smaller scale in an economy plagued by insularity. And it’s getting worse.

It’s not just about having a more market-driven economy. Germany is outperforming us with a highly socialized economy and massive government investments in information and communications technology, as well as an advanced apprenticeship system and a business culture that prioritizes worker training.

When one works through the numbers, it is clear that the primary reason for our malaise is a lack of private-sector investment in research and development and in work force upskilling. Canada ranks 17th of OECD countries regarding the percentage of GDP spent on R&D and among the lowest of G7 peers.

To catch up, Canada must show discipline in focusing incentives to catalyze the private sector where it can have the greatest impact. We must prioritize R&D and training incentives that contribute to physical and human capital efficiency strategies.

Stagnation was less concerning during the longest bull market in history, when a forceful rising tide of monetary policy fuelling economic growth was able to mask many concerning, deeper trends. But that veil has now been removed, revealing that Canadian firms are not well-positioned to innovate and grow.

The United States contributes to our economy through its innovation and production, but it is also our biggest competitor. The number of patent applications submitted by Canadian businesses in 2020 was roughly 1.6 per cent of those submitted by American businesses, which is staggering underperformance even when GDP-adjusted.

Foreign companies and investors looking at Canada will always use the U.S. as a benchmark, given our shared geographic and cultural features. The Americans, recognizing we are at an industrial and economic turning point, have thrown down the gauntlet with public policy and private-sector initiatives to further advance their productivity growth over the coming decades. The most significant being the Inflation Reduction Act, earmarking US$500-billion in new spending and tax incentives to boost clean energy, labour skills and other areas that will contribute to future productivity growth.

To avoid falling further behind, our government should respond meaningfully in the federal budget this week. Last year’s budget introduced the yet-to-be-defined $15-billion Canada Growth Fund, which would use public money to entice more capital to invest in Canadian industry and is one of several bodies created to help Canadian firms innovate. While these are steps in the right direction, they lack the scale the U.S. can deploy and run the risk of having the government or other public bodies choosing winners, something that private capital is much more adept at.

A policy lever that Canada has considered but never implemented is an “intellectual property box,” which would tax income from patents and other intellectual property at a lower rate, effectively guarding against “poaching” from lower tax jurisdictions.

Recent budgets have attempted incentivization through things like the scientific research and development program that provides tax incentives to businesses that conduct qualifying R&D activities. These are available for eligible R&D expenditures, including depreciation expenses on capital assets – matching them to the revenue they generate over time. But programs like these need to be expanded broadly across industry and made straightforward. Unfortunately, eligible candidates often don’t receive the intended incentivesowing to narrow application of the rules by our tax regulators.

The 2022 budget included some tax incentives for small businesses, but these appear more driven by politics than sound economic planning. OECD data shows that productivity growth is typically driven by the top 10 per cent of firms in an industry – the biggest players. This year’s budget should include incentives for large firms located in sectors rife for innovation, in energy, e-commerce, advanced manufacturing, transportation and finance, to spend directly on R&D, and simplify the process so they can move with alacrity to get things built and skills developed.

On skills development, Canada has a natural advantage with its broad public support for immigration and merit-based application program that brings in a high percentage of working-age people with credentials. But immigration already accounts for almost our entire labour force growth – the greater challenge lies in ensuring new workers can contribute with their potential and skillsets.

According to Statistics Canada, more than 25 per cent of immigrants with foreign degrees end up in jobs that they are overqualified for, in roles that require a high-school diploma at most. Improving recognition of foreign credentials, simplifying our immigration processes, and strengthening training and education opportunities are all important ways to gear our human capital strategy towards productivity. With economic demands shifting quickly, employers have skin in the game and will need to intensify efforts to implement work-integrated learning.

The future of our country depends on a more productive economy, underpinned by improved R&D spend and a more skilled work force. In this budget, the government must embrace every tool at its disposal and commit to bold action if it wants to be the architect of a prosperous, innovative Canada that stands tall in the face of international competition.

Source: Canada’s productivity weakness has a greater impact than most believe

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